Prices moved down in March.
Not just up-at-a-slower-rate (disinflation),
but down, down in absolute terms (deflation.)
Deflation, is both natural and good but because once in a while, in rare circumstances, it is a bad thing, some people think it is always and everywhere a bad thing. They are mistaken.
Which kind is this?
Well the market is taking it as a good thing.
Lower energy prices, lower egg prices are good.
Full Stop.
The Producer Price Index for final demand decreased 0.4 percent in March, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. . . .
. . . over 70 percent of the decrease in the index for final demand can be traced to prices for final demand goods, which fell 0.9 percent.
. . . Two-thirds of the March decline in the index for final demand goods can be traced to an 11.1-percent drop in prices for gasoline. The indexes for chicken eggs, beef and veal, fresh and dry vegetables, diesel fuel, and jet fuel also moved lower.
